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Why 3G will Never take off in India

Read on for a completely different view on Why 3G market and its potential in India is not so good as it is made out to be.

The fundamental problem is that many products are created to be sold, not used- Yanagi Japanese Designer[1]

Are you one of those people who believe that 3G may be a bit low today in India but is going to take of really big time in the near future ? Huge amount of data consuming public is imminent because you see so many people with smartphones around ? May have heard telecom companies paid a bomb to get 3G spectrum and govt for a change made a lot of money . Surely you think that telecom companies are not stupid to overpay for spectrum and hence in a country of around 600 million active connections they are going to milk money by 3G data usage by public.

Unfortunately this is not going to happen in even near future. The a seemingly simple consensus view – 3G will take off really big in India, it just needs a bit of time say 2-5 more years– just as it happened in developed countries.

What I am saying is that 3G will not take off as per predictions of almost all analysts and telecom companies. It will remain a fringe/negligible percentage of overall telecom users in future (maximum % of active users may not go beyond 10% even in next decade because 4G/LTE/BWA may be adopted and 3G almost skipped). The only way 3G usage can shoot up is when some company can make a phone with User Interface which is even simpler and delightful than iOS of Apple(and all of its copycats) and of course price it below Rs. 5000/7000 or $130 (unlocked of course).

Read on for a completely different view on why 3G will not take off as per almost everybody’s expectation. I promise your time in reading will be well utilized. Why 3G and 4G will NEVER take off in India Why 3G and 4G will NEVER take off in India.

After 15 months and selling 25 million iPads (revealed sales figure by Apple ) I wonder whether people who have criticized iPad are still in denial mode .
The most amazing part is almost every other company is now trying to be a copycat and bringing in tons of new tablets in the market which apple basically created from scratch .

I wonder how can Steve Jobs think of making a product which does not do the following things(1st Gen iPad) :
1. No Camera, that’s right, you can’t take pics and e-mail them.
2. No Web Cam, that’s right, no iChat or Skype Video chatting.
3. No Flash, that’s right, you can’t watch NBC, CBS, ABC, FOX or HULU.
4. No External Ports, such as Volume, Mic, DVI, USB, Firewire, SD card or HDMI
5. No Multitasking, which means only one App can be running at a time.
6. No Software installs except Apps.
7. No SMS, MMS or Phone.
8. Only supports iTunes movies, music and Books, meaning Money, Money, Money for Apple.
9. WAY, WAY, WAY over priced.
10. They will Accessorize you to death if you want to do anything at all with it and you can bet these Accessories will cost $29.99 for each of them.
11. No Full GPS*
12. No Native Widescreen*
13. No 1080P Playback*
14. No File Management*
(Source :http://www.ocwebdesignblog.com/index.php/technology/apple-ipad-is-a-ifailure/ )

And the end result of making a product which could not do the above things is- More than $10 billion dollar sales in 15 months with competitors being just flummoxed(in Jobs words) .

So what is it that makes iPad a tremendous success ?? And I wonder why can’t the competitors come up with a really such a innovative product by themselves ??

I mean before iPod the MP3 players were there but just not like iPod. Lots of smartphones were there before iPhone but iPhone really changed the way people thought about phones . Of course AFTER iPhone Android jumped in and now has larger volume market share than iPhone but again Android just copied iPhone and added a lot of other things in it rather than coming up with something unique by its own .

Same thing happened with iPad. iPad sold more than any other tablet ever combined(from the start of time) within 9 months of its launch with most intelligent people and reviewers terming it as a trash .

How is it that with so many things you supposedly cannot do with iPad people are still buying it ?? How is it that one company keeps on coming with amazing products , makes truck loads of money and the others just watch and then start to furiously copy Apple ??

I really ask why ?? I mean we consumers were served with phones before iPhone and Nokia and Blackberry were kings . And of course there was touch screen phones with windows mobile but those just weren’t like iPhone . Who knows had it not been Apple the world might never have had seen such gr88 touch screen technology at all . We may not have had phones like Galaxy S2 or HTC Desire series .

And talking about tablets I cannot believe that no company just ever thought about putting effort for tablets before apple . What are the guys at Microsoft doing ?? Why didn’t they come up with tablet computers which were good enough ??
Apple last quarter has capture 11% of PC market share by volumes of iPad . We are talking about serious money here upwards of $10 Billion a year sales which Apple had and look at the other so called innovative companies what they are doing .

And to top it all the other guys just are NOT able to price their tablets below Apple’s. I mean that’s the way it had always been . Apple’s products were and are always priced way above competitors but here with tablet they are pricing at exactly Apple’s price point . I wonder what will happen to all competitors tablets if Apple decided to get into cutting prices of its tablets by even say 10% . I shudder to think of the consequences to the competitors .

Yesterday Motorola came up with quarterly numbers saying sales of XOOM tablets around 440k which is OK . But alas they didn’t say whether that was actually sold to consumers or most are just lying on the shelves . Apple sold every tablet it could make , period .

Its an open question to the CEOs of following companiesSamsung , Google, Acer , RIM, Windows , Nokia , HP, Dell , Lenovo , Toshiba and lots more which I cannot list here. 1. What were you guys really thinking about tablets before Apple introduced iPad ?

2. Were you guys waiting to see how people respond to Apple’s tablets and let Apple take the risk (of course the reward as well of more than $10 billion sales within a year ) and then decide your strategy ?

3.With iPad in market for more than 15 months not a single tablet is yet seen to be really eating up iPad ? Why ?

4.Except HP why is almost all other guys are depending on Google to provide them the OS ? Dont your engineers can come with a better OS for Tablet ?

5.Does Board of Directors of company ever questioned any of the CEOs on their failure to latch on to tablet market even after 15 months of iPad ? What are the board members doing ??

6.Why is it that every single innovation really big innovation is coming from Apple ?When was last time any single product of any of your company just took the world by storm and created something like $5 billion in sales ??

7.Has anyone been fired/reprimanded/bonuses withheld for failing to capitalize on tablet market in any of the companies ??

8.Are any of the companies actually working on anything new which Apple is NOT working on ?? Can we expect any device in coming 5 years from any company which will blast a trail for others to follow ?

9.Are laptop companies and its board of directors still in denial mode that tablets will not eat up pc/laptop market share by just defending their own strategies ? Do companies realize that every tablet sold is one laptop NOT SOLD ? Or are you people just denying reality by saying that tablet is just another new market category and trying to hide your incompetency by saying that ??

10. When can I expect to see any product where people line up to buy ?? Dont you people feel ashamed even for a second that Apple is somehow able to get almost 100 people min per Apple store to line up to buy its products ?? Do you people just think that hundreds of people who line up to buy Apple products are fools ??

11. All companies are pricing their tablets at exactly or almost same as iPad .Have any of the companies thought of a possibility that tomorrow when you CEOs wake up you get the news that Apple has cut the price of all models of iPad by 15% or 10% ?? What then ?? Fold up the tablet division ??

I know I will never get answers to these questions from top people but so what no harm in just trying to be a feedback giving consumer .

I just came across article in Economic times where we have following comments“Tablet is essentially a content consumption device than a content creation device… It will never be able to eat into PC sales, especially in emerging markets such as India”
Vyomesh Joshi, Executive Vice President, Hewlett Packard

“Tablet has become an aspirational device for people who possess more than one computer. But India will never see PC sales being hit by tablet sales, due to the sheer low per capita income of the country”
Ashwini Aggarwal, Former Executive Director, MAIT (MAIT, Manufacturer’s Association of IT Industry, is an apex not-for-profit body representing and driving the eco-system of the Indian IT)

Well it just made me think whenever some one senior(and supposedly intelligent and has vision) makes really big future prediction with a word like NEVER .

Well here is an excerpt from HP Quarterly conf call with analysts :“In Q2, consumer PC revenue declined over 20% year-over-year. Even though our consumer PC expectations had been cautious, the steepness of our Q2 decline is greater than what we had anticipated. We are remaining cautious in the near term .”

Here is tablet sales by Apple only(well in fact only Apple matters when I am talking about tablets):“Apple sold 9.25 million iPads during the quarter, a 183 percent unit increase over the year-ago quarter”.
Infact apple has sold a total of 25 Million iPads in around 15 months.

Assume all of Apple sales were in Developed markets and NONE in emerging markets like India . Even the dumbest of person can say at least somebody is buying tablet where he might have bought a laptop if tablets did not exist .
Now that somebody need not be from the Developed country only . If someone thinks that per capita income of India and China is very low and hence tablets will never eat into pc sales then he is the most ignorant person on planet earth . And believe me the price of tablets are not too high by any standard at all . They are almost equal to what a full sized laptop costs .

HP(and all computer makers) is dead scared of tablets and hence has brought its own touchpad(other computer makers and mobile phone companies also are trying to copy Apple) in market to compete with iPad.
In India I do not have any sales numbers from any companies which show how many tablets have they sold but walk in to any Croma or ezone store and you would see wide variety of tablets on display from samsung to acer to blackberry and of course Apple . And they are selling though I cannot quantify it .
With all these data I cannot believe that really senior people can think that a product costing almost same as a highest end mobile phone (iPad 1 starts from Rs. 23000 only while a lot of mobile phones cost more than Rs. 23k) will not eat into PC market share .

People just think Indians are so poor that they cannot even afford buying tablets . I absolutely agree with the pathetic state of India’s per capita figure but India and China are so huge that even 0.1% of people (who are really rich and mind you for India that equals almost 9 million people) will be enough for companies with really good tablet offering to succeed and have a good return on investment .

Those companies who will ignore India because they think Indians are poor do so on your own peril . (please learn from Apple who though was late by almost 8-10 months in bringing in iPad 1 to India introduced iPad 2 as soon as it could and boy its selling like hot cakes in India as well .)

My prediction- Tablets in emerging countries are going to eat into laptop sales . How much I dont know but its easy to find out . Any person buying a tablet means a laptop is not sold . Do the math !!!!!

Here is the proof of it :

iPad is now 11% of PC market

According to IDC’s estimates, worldwide personal computer sales excluding tablets were 84.4 million during the quarter .

Looking at it another way, assume that most iPads were sold to consumers, and that overall PC sales are split about halfway between consumers and businesses. In that case, the iPad has already sucked up about 20% of the consumer PC market.

Lets say if iPad was lined up with all the other computer makers it would be the 4th Biggest computer brand in the world –after HP, Dell and Lenovo …oh yes ahead of Acer .
If the macs(3.95 million) were added to iPad’s sales last quarter total will be 13.2 million with apple being 2nd largest computer vendor in the world after only HP (with 15.3 million).

And after this look at the confidence(ignorance) of HP VP saying Tablets will not eat up the market share of PC(laptop) . Its truly Alice in Wonderland Situation .